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Now What?
As BofA notes, the lack of hike is an admission that Wall Street threatens to reverse the recovery on Main Street
- It will lead to a short-term relief rally on Wall Street
- It will be relatively positive for EM/commodities/resources, as it unwinds the higher US growth/rates/dollar narrative
- It will be positive for higher-yielding assets
- It will be positive for growth > value, as the Fed is confirming the deflationary recovery
In short, if the Fed’s failure to hike does not lead investors to completely abandon hope on growth and scurry into gold, cash & volatility...
Which they are.. (note that bonds started moving much earlier)
Then look for the “barbell of 1999” to reemerge: Über-growth & Über-value were massive outperformers after the Asia crisis
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Party on Dudes!
"Recovery on Main Street"? LMFAO. Go ahead, show me this recovery.
That's right, scurry into gold, maggots! And behold with thine own eyes the laughable "spot price" be doubled. Wail and moan as there is none to be had! Bring out your dead.
Yeah there is no Recovery on Main Street but the Burglary on Main Street continues thanks to J-bitch Yellen.
Union Pacific on Wednesday began laying off employees in Omaha after the company in August announced that staff cuts would be coming.
The company is confronting a sharp slump in cargo volume.
http://www.omaha.com/money/union-pacific-begins-layoffs-it-announced-in-...
Green shoots.
Now what?
Now gold up and stocks to crash.
Why? QE4-10 and negative interest rates are waiting in the wings. If this doesn't add +50% to the DOW I'd be amazed.
Or do you think anyone cares that the Fed is worried? Only thing people care about is investing on leverage using free money and with the Fed backstop.
Period.
Because soon, people will figure out we are the new Zimbabwe.
What part of "Dow+50%" sounds like Zimbabwe to anyone?
This is not a meme it's a global ponzi, run by people who Chuck Ponzi would have thought genius.
The shit show that never ends. Well...look at the metals go up...this will last what...17 minutes...then the monkey hammer will be back. Gold down $4 by tomorrow? I really thought they were going to raise rates. In 2012 the Fed said if unemployment falls below 6.5% and inflation is below 2.5% they would raise them. Well Fuckers??? Short that market NOW.
"In 2012 the Fed said if unemployment falls below 6.5% and inflation is below 2.5% they would raise them."
Think about how silly that is. Rates historically only go up when there's inflation: rate increases are meant to put a check on inflation, with inflation being the result of an over-heated economy. Clearly, we DON'T have inflation. The likelihood of ever encountering an over-heated economy again is essentially zilch.
Deflation is vicious now. I don't know how many retail stores will go bankrupt. I just bought a 3-pack of socks reg $32 now $1.80.
How bloody can their profit margin be?
Clearly, we DON'T have inflation.
Well we did have a nice trifecta of inflation going in energy, RE and food. Energy took a dump and I'm pretty sure residential RE is next as Housing Bubble 2.0 implodes. So if my bag of lays stops shrinking every few months you'll be spot on.
Well, for sure, it's all jumbled! And I might not be correct here.
In "normal" economic cases "overheated" meant that there was overproduction happening. In that case there was also a lot of money flying around: high velocity of money happening. Now we have overproduction, BUT, the velocity of money is vastly lower than what our historical sense of "overheated" has/had been.
Raising rates is usually meant to decrease the money in circulation, force lesser-prudent use of money to be pushed away/out. What we've had is fewer entities shuttling large amounts of money back and forth (many years ago I'd predicted this very scenario). The "rate-controllers" cannot push rates up now because the big entities are hanging on to so much marginal shit that undermining any of them will kick the economic table out from everyone seated at the table (everyone connected to The System).
In a more classical sense of inflation/deflation, where it's about MONEY SUPPLY, we're clearly in more of a deflationary path with the destruction of credit happening.
That velocity of money thing/issue is really the kicker. TBTB look to their play-book and cannot find this scenario there. They cannot find it because their model, and, really, humanity's model, is ONLY about growth.
Long ago I scrapped calling "price increase" and "price decrease," (this came about when trying to figure out future pricing on energy/oil- mind you this was MANY years ago!) opting instead to state things using the notion of "affordability." You could think that if you bag of Lays stopped shrinking, and also assuming the cost stayed the same, that inflation would be nixed; HOWEVER, IF your wages dropped then it would pretty much be the same, back to square one, the SAME effect!
"over-heated economy"=="growth ponzi"
... and the exponential growth Ponzi is dead or nearly so. Nobody (no human) is knocking down the doors anymore to add fuel to that fire. The late-to-the-game Chinese farmers would get out if they could, but it would mean prison for some of them if they tried. Nobody is jumping first into those shark infested waters.
Get ready now for the money to burn up. Too many claims on too few things, and everyone is going to want delivery pretty soon. The Dow will add 10% over the next week but the volumes will be thin as dust. Hot money will be getting out of China, India, Brazil you name it. Forex carnage followed by cap controls, and then the door is shut forever.
Deflation wins this one in the third round. The resulting singularity will erase everything that ever touched money.
Ah! One of the reasons why I still bother to come back to this site! There are yet signs of intelligent life here!
"Too many claims on too few things"
This sounds like more demand than supply which seems like it should cause inflation. Just trying to understand this and how it causes deflation. Is cash considered a claim on things or a thing to be claimed?
The repeated threat of a whipping works for a while, but eventually you lose all control and respect.
Now What?
Dry the Damp Squib
Just attack gold and silver. Confidence is infinite fiat must be maintained at all cost.
Keep giving them free money to short precious metals, even as the deliverable supply dries up.
It's been pissing me off. The truck has been ready and in reverse but I'm still waiting to back it up... had been thinking that my patience would tolerate sub $1k/oz for gold, but this yo-yo-ing around $1,1k is trying my nerves! Really think that there's going to be another big push-down before the facade crumbles (in plain view).
The 'facade' just crumbled and if you wait for 1K gold you will wait forever.
Maybe.
Rest assured, my battering average is pretty fucking high. I've beaten most over the past 8 years. On one hand I'm extremely impatient; on the other I'm sickeningly patient...
What fucking recovery???
Jive ass lying shits
Chaos on the Fox Business Network.
It't kinda funny though.
6 people talking at once.
Its nice to know we are now looking for GLOBAL stability before they raise rates.
End the FED.
Period.
And as the exponential function goes, I'm sure that this will be upgraded to waiting until there's stability in the universe (the expansion, or if you're on the other side of the science, contraction of the universe needs to be stabilized first!). Not so far fetched when you consider that humans have been under the illusion of being rescued by gods or of escaping via rocket ship (technology).
Well, we can't say we didn't predicted it....
CAN I HAVE SOME QE4, 5 AND 6 TO GO?!
SD...I really have to agree with you now. I thought they would raise....but you are right. They have to go QE4,5,6,7,8...it can't stop now. I am telling you waht..this sure reaffirms my metals purchases that I lost at the lake. Does anybody have a Metal Detector with the 300 foot coil. And waterproof.
They now predict NIRP!
idiot
Maybe not. We might be through that "phase" and are now going to be seeing spending cuts happening at govt levels in an attempt to lure in the ever-decreasing amount of money in circulation (fight with corporate bonds). At this point it's pretty clear that just pushing up the numbers ain't doing squat; further, and more importantly, it's becoming clear that the fires are only getting BIGGER.
I suspect that if there's going to be any more helicopter drops it'll be directly onto households, with a direct message to shove that money back to the banks in what will be a back-door approach for/of debt jubilee. IF, that is, various bankster mobs agree to it; if they don't then it's WAR.
Markets have moved basically sideways for more than a year. The exact policies in place now are the same ones that were in place a year ago. Its in a coma.
And even when in a coma it can still communicate that it's in a state of denial!
2 minutes away! I want to have snarky play by play comments somewhere.
2 minutes away from what??
Sheetmanna.
Like I said yesterday, with everyone from Canada
to China devaluing, you could expect the FED to
drop any rate hike talk.
And read my electrons... QE4 by X-Mas.
I don't think so. I think this time they admit that they can't stimulate durable growth without funding main street which means helicopter drops and hyperinflation. It either that or bankruptcy.
I'm tending to lean this way as well.
SPY to 205 and then to 25?
We are all Japanese now...
You really think so...?
The Japanese didn't have a high gun ownership rate.
Just Wow. Exactly backwards, the fake recovery on Wall Street (over double from the low in 2009) is now at risk of unwinding itself back to match the reality that there has been no recovery on main street.
Lets see how we do when Mother Nature finally takes over.
The FED has two Masters--1) The big banksters and 2) Obama
Obama has overuled any interest rate increases for the duration of his tenure.
If this action doesn't justify getting rid of the FED, nothing will.
Don't be ridiculous. Obama takes his orders from the same folks Yellen does.
The president is utterly powerless.
If he takes orders from the banks, then it is a CHOICE.
He has tremendous power at his disposal.
Even the banksters recognize tha, and won't cross a line.
Bullshit. Every single organization the president allegedly controls is in the pay of the squid. Failure to adhere to the script gets him nothing but dead.
Based on the expansion in the money supply, gold's real price is $8,000 per ounce. They originally printed to save the banks and the stock market, selling the move as 'protecting the pension plans' of Americans. The truth is that the US went bankrupt in 2008/09 and everything since then has been nothing but smoke and mirrors trying to stave off the invetibale collapse. If they release the 5 Trillion to the general economy they will have hyperinflation. If they don't release the money they will have insolvency first followed by a collapse. If they print more they will only make things worse. They are well and truly fucked and they know it. Buy GOLD NOW.
The money printing was, as you note, only stuffed into holes in banks' balance sheets. In the long-run, Rock beats Paper, for sure!
I don't like to provide investment advice because there's always some fucking monkey-wrench lurking that can be overlooked. I'd mentioned this before, and that's that it's quite possible that he re-rack will have PMs become outlawed due to traceability issues ("terrorists" are using it, etc.); bankers and other PTB will "give" up their gold in exchange for "protection," the side deal being that they'll be given front-row seats at the new game/table (the wealth will be returned via the back-door); the commoners will be purged of their PM, TPTB's "order" (power) will be firmly restored. The question is that of: will TPTB be able to regain control? (if not, then PMs will be ours to use; if so, then be prepared to be ratted out by your neighbor [or anyone who is "poor"] as being a "terrorist") Oh, the mechanism will be that the banksters will agree to NOT facilitate any PM transactions: no merchants etc, will be allowed to; effectively no PM transactions are allowed/legal.
Not even I can See how this one is going to go down!
If they found it hard to raise rates now, does anyone think they'll do so with a weakening global economy during an election year? I don't think so.
If I were a betting man, I'd say they're go to couple another round of counterfeiting, er, QE, with a massive fiscal stimulus. Helicopter money. All caution thrown to the wind. Deficits be damned.
The pitch forks will find them no matter what at this stage of the game.
So, is it time to cash out and trade all our FRN for Ag and Au while we still can??
Depends! Are you going to flip a gold coin or a fiat coin?